8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934

Date of Report: July 2, 2007
(Date of earliest event reported)

AGILYSYS, INC.

(Exact name of registrant as specified in its charter)

Ohio	000-5734	34-0907152
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2255 Glades Road, Suite 301 E, Boca Raton, Florida	33431
(Address of principal executive offices)	(ZIP Code)

Registrant’s telephone number, including area code: (561) 999-8700

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.01 Completion of Acquisition or Disposition of Assets.

On July 2, 2007 Agilysys, Inc. and its wholly-owned subsidiary, Agilysys NJ, Inc. (the “Company”), completed the acquisition of Innovative System Design, Inc. (“Innovative”), pursuant to the Agreement and Plan of Merger between the Company and Innovative dated May 25, 2007 (the “Agreement”). The acquisition price was $100 million in cash, subject to a working capital adjustment. If the Closing Working Capital, as defined in the Agreement, is less than the Working Capital Target, as defined in the Agreement, the former stockholders of Innovative will pay the Company the amount of such shortfall. For a period of 18 months following the closing, $7.5 million of the purchase price will be held in escrow, and such amount may be used to pay any working capital adjustment due to the Company or to cover certain indemnification payments which the former stockholders of Innovative may be required to make to the Company. If the Closing Working Capital is greater than the Working Capital Target, the Company will pay the former stockholders of Innovative the amount of such excess.

In addition to the $100 million purchase price, the Company will pay an earn-out of two dollars for every dollar of earnings before interest, taxes, depreciation, and amortization, or EBITDA, greater than $50 million in cumulative EBITDA over the first two years after consummation of the acquisition. The earn-out will be limited to a maximum payout of $90 million.

There are no material relationships between the Company or its affiliates and Innovative other than in respect of the Agreement.

This brief description of the Agreement is not intended to be complete and is qualified in its entirety by reference to the full text of the Agreement, which was filed with the Securities and Exchange Commission on Form 8-K on June 1, 2007.

The financial statement and pro forma financial information required by Item 9.01 is not included in this Form 8-K. The Company will provide the required financial statement and pro forma financial information in an amendment to this Form 8-K within the allowable timeframe.

Item 7.01 Regulation FD Disclosure

On July 2, 2007, the Company issued a press release announcing that it completed the acquisition of Innovative. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

99.1 Press release issued by the Company dated July 2, 2007, announcing that it completed the acquisition of Innovative.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

AGILYSYS, INC.
By:	/s/ Martin F. Ellis
	Martin F. Ellis
	Executive Vice President, Treasurer and Chief Financial Officer

Date: July 6, 2007

Exhibit Index

Exhibit Number	Description
99.1	Press release issued by the Company dated July 2, 2007, announcing that it completed the acquisition of Innovative.

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Agilysys Completes Acquisition of Innovativ

BOCA RATON, Fla. — July 2, 2007 — Agilysys, Inc. (NASDAQ: AGYS), a leading provider of innovative IT solutions, today announced it has completed its acquisition of Innovativ Systems Design, Inc., a privately held integrator and value-added reseller of servers, enterprise storage management products and professional services.

At approximately $260 million in revenues, Innovativ is the largest U.S. commercial reseller of Sun Microsystems servers and storage products. The company designs, implements and deploys complex, large-scale IT infrastructure solutions, acting as a single hardware, software and services source for its enterprise customers. Employing an experienced team of senior technology and business experts, Innovativ also offers a broad portfolio of proprietary professional services to support its customer solutions. With the company’s Sun relationship and strong presence in financial services and telecommunications, the acquisition will further diversify Agilysys’ supplier mix, establish new markets and broaden the company’s customer base.

Arthur Rhein, chairman, president and chief executive officer of Agilysys, said, “The addition of Innovativ establishes a new and significant relationship between Sun and Agilysys and represents an important step in continuing Agilysys’ growth as one of the leading providers of IT solutions to corporate and public-sector customers.”

The purchase price of $100 million will be funded by cash on hand. In addition, Agilysys will pay an earn-out of two dollars for every dollar of EBITDA greater than $50 million in cumulative EBITDA over the first two years after closing. The earn-out will be limited to a maximum payout of $90 million.

Forward-Looking Language
Portions of this release, particularly the statements made by management and those that are not historical facts, are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current assumptions and expectations, and are subject to risks and uncertainties, many of which are beyond the control of Agilysys. Many factors could cause Agilysys’ actual results to differ materially from those anticipated by the forward-looking statements. These factors include those referenced in the Annual Report on Form 10-K or as may be described from time to time in Agilysys’ subsequent SEC filings.

Potential factors that could cause actual results to differ materially from those expressed or implied by such statements include, but are not limited to, those relating to Agilysys’ long-term financial goals, anticipated revenue gains, sales volume, margin improvements, cost savings, capital expenditures, depreciation and amortization, and new product introductions.

Other associated risks include geographic factors, political and economic risks, the actions of Agilysys’ competitors, changes in economic or industry conditions or in the markets served by Agilysys, and the ability to appropriately integrate and derive performance from acquisitions, strategic alliances, and joint ventures.

In addition, this release contains time-sensitive information and reflects management’s best analysis only as of the date of this release. Agilysys does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release. Information on the potential factors that could affect Agilysys’ actual results of operations is included in its filings with the Securities and Exchange Commission, including, but not limited to, its

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Annual Report on Form 10-K for the fiscal year ended March 31, 2007. Interested persons can obtain it free at the Securities and Exchange Commission’s website, www.sec.gov.

About Agilysys, Inc.
Agilysys is a leading provider of IT solutions to corporate and public-sector customers, with special expertise in select markets, including retail and hospitality. The company uses technology—including hardware, software and services—to help customers resolve their most complicated IT needs. The company possesses expertise in enterprise architecture and high availability, infrastructure optimization, storage and resource management, and business continuity; and provides industry-specific software, services and expertise to the retail and hospitality markets. Headquartered in Boca Raton, Fla., Agilysys operates extensively throughout North America, with additional sales offices in the United Kingdom and China. For more information, visit www.agilysys.com.

Media Contact: Julie Young
Director, Corporate Communications
Agilysys, Inc.
440-519-8160
julie.young@agilysys.com

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